In the wake of the company’s better-than-expected Q3 2022 financials and guidance raise, Goldman Sachs has opted to upgrade Biogen (NASDAQ:BIIB) to Buy from Neutral, noting an upcoming Phase 3 data readout on its experimental Alzheimer’s therapy lecanemab.
Even as the company struggled to generate sales for its FDA-approved anti-amyloid Alzheimer’s therapy Aduhelm, Biogen (BIIB) surged in late September after announcing that lecanemab which it develops with Eisai (OTCPK:ESALY) (OTCPK:ESALF) met the primary endpoint in the late-stage study.
Despite investor concerns about the full study results to be presented in November, “our discussions with leading neurologists and management lead us to believe that the results are clinically meaningful notwithstanding competitor assets,” Goldman Sachs analysts wrote.
Rival Alzheimer’s drug developers Eli Lilly (LLY) and Roche (OTCQX:RHHBY) (OTCQX:RHHBF) are set to post late-stage readouts for their anti-amyloid candidates later this year and in mid-2023, respectively.
Raising the price target on Biogen (BIIB) to $370 per share, the analysts noted that lecanemab is expected to generate peak global sales of $14B and its functional benefit in Alzheimer’s could meet rigorous Medicaid requirements to support broader coverage.
Despite FDA approval for Aduhelm in 2021, Medicaid restricted the coverage for the anti-amyloid treatment and similar drugs amid concerns over efficacy.